Nesta Impact Investments has invested £750,000 as part of a £4 million round in energy flexibility marketplace software Electron. Electron has developed a platform – ElectronConnect – to help network utilities launch, operate and coordinate local energy flexibility markets at scale.

Nesta has invested alongside East Innovate – the venture capital arm of quantitative commodity, technology and research company, East Alpha – Riverstone, and One Planet Capital.

Energy flexibility is crucial to maximising the renewable energy capacity of the national grid, which ultimately powers UK households. It is a key piece of infrastructure to deliver Nesta’s sustainable future mission to decarbonise UK households.

Existing grid infrastructure is not set up to manage either the scale of electricity required to meet our net-zero targets or new ‘intermittent’ renewable energy increasingly being added into the system. We expect both to rise by around two times over the coming decades. Given the timescales and costs involved with increasing grid capacity, network operators are actively pursuing ‘demand flexibility’ as a solution. This will enable them to increase the renewables mix within the constraints of their existing infrastructure. Regulations are also in place that require network utilities to introduce location-specific flexibility markets.

Electron’s platform, ElectronConnect, can help allocate energy from renewable sources such as wind and solar more efficiently through flexibility markets. It allows network operators (Electrical System Operators (ESO) such as National Grid and Distribution Network Operators) to automate and scale demand flexibility provision. This is intended to increase the use of renewables within their networks. Electron supports network stability through better management of the flow of energy through constrained parts of the networks.

In time, Electron’s capabilities will help reduce the fees that are paid by operators to turn down / off their output at certain times. This could mean a cost saving is passed on to energy consumers. As the market for demand flexibility matures, Electron has the technology to unleash the abundance of renewable energy by connecting millions of distributed energy resources (wind, solar, heat pumps etc,) to thousands of coordinated flexibility markets using ElectronConnect. We look forward to watching the company grow and innovate to deliver an efficient and clean energy system.

Electron’s CEO, Jo-Jo Hubbard, said: “We believe that time and location-based markets for energy and flexibility are foundational to the fastest, cleanest path to net zero energy. But, when Electron started developing these markets six years ago, the policies, business models and technologies required to support such markets were still unclear.

Fast forward to today, many of the world’s major economies have already reached 50%+ variable renewable generation; storage technologies have reached inflection point; over 1 million electric vehicles are already on the road; and increasingly congested networks have risen to the top of political agendas. There has never been a clearer need or mandate to deploy flexibility markets at scale.

This is the inflection point for which we developed ElectronConnect: built with 25 utility partners across five countries to be the world’s most dynamic and integrated market platform for distributed, low-carbon grids. This funding brings us the resources to scale, as well as the right partners, insight and support on that journey. We are grateful for the backing of investors, like Nesta, who share our vision and are excited to get going.”